Page 36 - The Indian EYE 051923

BUSINESS EYE MAY 19, 2023 | The Indian Eye 36

INFLATION DOWN & FOREX UP

Finally, some good signs

of economy in recovery mode

The overall reserves had dropped by $ 4.532 billion to $ 588.78 billion in the previous reporting week

OUR BUREAU
New Delhi

he annual retail inflation eased
to 4.7% in April from 5.66%
Tthe previous month, govern-
ment data showed on Friday. It is for
the second month in a row that Con-
sumer Price Index (CPI) based infla-
tion remained within the RBI’s com-
fort zone of below 6%.
Retail inflation has fallen to an
18-month low mainly due to cooling
food prices. The retail inflation based
on Consumer Price Index (CPI) was
5.66% in March 2023 and 7.79% in
the year-ago period. Retail inflation
in April is the lowest since October
2021 when it was at 4.48%.
Industrial output India’s indus-
trial production rose 1.1% in March,
according to official data released on
Friday. Factory output measured in
terms of the Index of Industrial Pro-
duction (IIP) grew 2.2% in March 2022.
The data released by the National
Statistical Office (NSO) showed that RBI Governor Shaktikanta Das on Friday said the cooling off in headline inflation to 4.7 per cent during April is “very satisfying” (ANI photo)
the manufacturing sector’s output in-
creased 0.5% in March 2023. Mining growth, the central bank put the the official data on Friday gives confi- by global developments.
output rose 6.8% during the month brakes on its tightening cycle in April, dence that the “monetary policy is on During the week ended on
under review while power output de- while leaving the door open for ma- the right track”. May 5, the foreign currency as-
clined by 1.6% in March. neuvering until the “war against infla- He, however, declined to com- sets, a major component of the re-
According to the National Sta- tion” is over. ment if the release of the numbers serves, increased by nearly $ 6.536
tistical Office, inflation in the food The decline in inflation is expect- will lead the RBI to be less hawkish or billion to $ 526.021 billion, accord-
basket was 3.84% in April, as against ed to help the central bank’s six-mem- change the stance of the policy, quip- ing to the latest Weekly Statistical
4.79% in March and 8.31% in the ber Monetary Policy Committee leave ping that all of it will be clear on the Supplement released by the RBI.
year-ago period. Retail inflation rose the benchmark rate unchanged for the morning of June 8, when the next pol- Expressed in dollar terms, the for-
from 5.7% in December 2022 to 6.4% second time when it meets on June 6-8. icy review is scheduled. eign currency assets include the effect
in February 2023 on the back of high- Although price pressures have Meanwhile, India’s foreign ex- of appreciation or depreciation of non-
er prices of cereals, milk and fruits and eased, unseasonal rains and rising change reserves jumped by $ 7.196 bil- US units like the euro, pound and yen
slower deflation in vegetable prices. housing costs are the new risks on lion to $ 595.976 billion in the week end- held in the foreign exchange reserves.
Last month, India’s central bank the minds of policy makers. Earlier ed on May 5, the Reserve Bank of India Gold reserves increased by $ 659 mil-
surprised markets by holding its key this month, finance minister Nirmala said on Friday. The overall reserves had lion to $ 46.315 billion, the RBI said.
repo rate steady after six consecutive Sitharaman said inflation is “slightly dropped by $ 4.532 billion to $ 588.78 The Special Drawing Rights
hikes to tamp down inflationary pres- above” a tolerable level and the gov- billion in the previous reporting week. (SDRs) were down by $ 19 million to $
sures. Many economists expect it to ernment is working to control it. In October 2021, the country’s 18.447 billion, the apex bank said. The
remain on pause mode for the rest Reserve Bank of India Governor forex reserve had reached an all-time country’s reserve position with the
of the year to support the recovery in Shaktikanta Das on Friday said the high of $ 645 billion. The reserves International Monetary Fund (IMF)
Asia’s third-largest economy. cooling off in headline inflation to 4.7 have been declining as the central was up by $ 20 million to $ 5.192 bil-
With higher borrowing costs per cent during April is “very satisfying”. bank deployed the kitty to defend the lion in the reporting week, the RBI
weighing on India’s world-beating The governor said the release of rupee amid pressures caused majorly data showed.

www.TheIndianEYE.com